"Consumers have a reasonable expectation of privacy," Jepsen said in a statement. "This agreement recognizes those rights and ensures that Google will not use similar tactics in the future to collect personal information without permission from unsuspecting consumers."
From 2007 to 2010, Google cars collected data from nearby unsecured Wi-Fi networks as they drove through neighborhoods taking pictures for the company's Google Maps Street View project. The data included Internet activity, passwords and other personal information.
At first the company said the data collection was unintentional, then said it was the work of a lone engineer who was acting without permission.
The Federal Communications Commission (FCC) investigated the incident and was unable to conclude whether Google violated federal wiretapping laws. But the FCC fined the company $25,000, saying it "deliberately impeded and delayed" the agency's investigation into the case.
"We work hard to get privacy right at Google," a company spokesman said. "But in this case we didn't, which is why we quickly tightened up our systems to address the issue. The project leaders never wanted this data, and didn't use it or even look at it. We're pleased to have worked with Connecticut Attorney General George Jepsen and the other state attorneys general to reach this agreement."
Jepsen said the company deserves credit for working in good faith to "develop policies and best practices to protect consumer privacy going forward."
Steve Pociask, president of the American Consumer Institute, said the penalty is only a slap on the wrist for the Internet giant.
"With revenue of $100 million a day, the fine just a drop in the bucket and not enough to deter bad behavior," Pociask said.